Which of the following statements is TRUE?
A) Cartels are an important source of economic growth in developing countries.
B) Economists are not opposed to government-created cartels since they usually provide high-quality products and service.
C) One cost of government-sponsored cartels is that people spend resources trying to obtain or maintain a cartel rather than produce better products.
D) All of the answers are correct.

Question

Quizplus · Accepted Answer

Government-sponsored cartels often result in a misallocation of resources, as individuals and firms strive to obtain or maintain membership in the cartel rather than improve their products or services. While cartels can provide economic benefits in some cases, the costs associated with them should be carefully considered. Choices A, B, and D are false statements.

Which of the Following Statements Is TRUE